How I would Yahoo!

So, apparently Yahoo! is up for sale, and even better, Google are willing to help fund it’s resurgence. This sounds so familiar – in 1997, Apple were having serious problems and Microsoft, their once main competitor, invested $150 million in the company, and now Apple is worth more than Microsoft!

Back to Yahoo!, it’s amazing how many people are so dismissive of Yahoo!’s (that’s a lot of punctuation) value.

In the UK alone, adults spend over 3 hours a month just on Yahoo! Mail.

To build that audience of 500 million would cost a HUGE amount of money (and time), so in my opinion there’s never been a better time to Yahoo! Stock is set at a very reasonable price, and Google are willing to invest a significant amount of money.

Here’s what I would do if I took over Yahoo! tomorrow:

Focus

An Internet content portal above all else. In terms of competition, Google provide mail to compete with Yahoo! Mail however there is no one with similar a traffic size which provides the level of content as Yahoo!

Generate a cost/revenue model for services such as Yahoo! Mail and Flickr to see if it’s worth selling these on or keeping them and reinvesting.

Create a cloud development service model to compete with the likes of Amazon and Microsoft – turning a cost centre into a profit centre

Analytics

Work out where my users are coming from – is it mainly from PC manufacturer-set-browser-homepages which haven’t been updated for 5 years? In fact, I’d probably do most of my initial work on the analysis of who uses the individual Yahoo! services to ascertain the users’ value, or even try to derive an ARPU (Average Revenue Per User).

Innovation

Yahoo! strikes me as a company which is struggling to innovate. How many new services of note have their launched recently? I would look at why this has happened – have they all left to go to competitors? Internet companies need to have innovation at the centre of their philosophy, vision and corporate structure in order to keep users returning. I would reignite this passion for innovation immediately.